Hi I just recently started knitting and I'm currently working on a knitted monster. So far I've got his legs on my magic loop and the pattern I'm following told me to cut my yarn, but it doesn't say anything about adding new yarn, just to start with his body using the magic loop...am I being really blonde here? But what's the next step, because the yarn it told me to cut can't possibly be long enough to do the whole body!!

Can you link to your pattern or give it's name and where you found it? Maybe you could post just a few lines from the pattern.

I'm making an assumption here that you've got both legs on the needles, knitted in the round, and it's time to join them together and start knitting the body. In that case you would cut the yarn on one leg, knit across the front or back, which ever it is, of the first leg with the working yarn and then start knitting the other leg with the same yarn, leaving the tail of cut yarn hanging. HTH

__________________~ GG
I should never overestimate my basic arithmetic skills.

Quote:

Cheating is an option. . . . Cheaters never win and winners never cheat, but smart knitters who want to retain an iota of sanity do, cheerfully. ~~Kory Stamper

I wouldn't worry about cutting the yarn, especially if the pattern tells you to cut the yarn. It may be that you're to start the body on magic loop with a new end of yarn. We're both guessing here because we don't have the pattern. As GG mentioned, even a few lines (not the whole pattern because of copyright issues) at the end of the legs and start of the body would help.

It says "at end of round 16 backward loop cast on 2 stitches, cut your yarn.
Transfer legs to circular needle, for the first leg put 8sts on front needle and 10 on back, for second leg again make sure to cut yarn and put 10 sts on front and 10 sts on back. You will have a total of 36 sts and new beg of round in middle of the second leg.

Body - use magic loop , PM to indicate beg of round and beg.".... And I'm lost after "you will have 36sts"

It does seem that you'll have 38sts on the needle for magic loop, distributed as the instructions say. You'll have leg #2 near the tips of the needle, 10sts on the front tip and 10 on the back. Pull out the tip of the back needle and use it as the right workng needle. Slip a marker onto this right needle, start with a new end of yarn and knit the stitches off the left needle. You'll be starting halfway through leg 2.
If you haven't tried magic loop before, here's a good video.

You're doing great. These small projects or animal monsters are oftern a lot more fiddley than a sweater or lace shawl.
Just hold the yarn in place with your left hand or let is dangle loose as you suggest. You can always go back and snug it up later. Leave about a 6 inch tail so you have plenty of yarn to weave in later.